By Ali Akbar
Oct 25 - 31, 1999
Development of Internet services in South-East Asia has been
remarkable. But access to the Internet is still woefully inadequate in South Asia, where
it is needed most.
By any scale of measurement, the South-Asian continent has the
potential to become the largest bloc of telecom users within a five-year time span.
Shortly after the turn of the century, the region will be the home of about 3.5 billion
people, which would lead to make markets of a size and scale that have been unheard of in
the West. Complementing the billions of dollars of investment pouring into the region for
increasing teledensities, many countries in South-East Asia are channeling some of the
resources towards developing Internet services.
Indeed, developments such as the so-called multimedia super corridor
(MSC) in Malaysia indicate that extending access to the Internet is a cost-effective way
of making people telecom-aware today, and will be an integral part of service requirements
tomorrow. The accomplishments of the National Computer Board (NCB) of Singapore, the
objectives of the multimedia super corridor (MSC) project in Malaysia and the rapid growth
of IT and Internet use in Taiwan, Hong Kong, Korea, Thailand, and even Indonesia, are
influencing policy-makers in the other countries of the region such as Pakistan and India.
In India, for example, multi-site companies are building intranets,
while some provincial governments are building their own 2 Mbps IP network for improving
governance, serving public hospitals, as well as commercial undertakings such as transport
corporations, electricity companies and so on. Whereas Pakistani government officials have
kept strong eye on the strategies and policies implemented by neighboring countries.
Pakistan officials shall finally implement those strategies in Pakistan after observing
the impact in neighboring countries.
In this context, the liberalization in other countries, notably
Malaysia and Indonesia, lends powerful support to the cause of telecom reformers in
Pakistan and India. The on-rush of global electronic highways and the Internet are
compelling Pakistan telecom to deploy optical fiber cables extensively. The private sector
basic telephone licenses are obligated to use only fiber optic cables (or wireless) within
South Asia is already trying to gain shares in software export and
utilization of growing technology such as Internet. Last year $ 1 billion worth of
software was exported over about 450 leased high speed (64 kbps and above) data circuits
and seven dedicated teleports that offer broadband digital satellite and submarine cable
links in the region. Software exports are growing at about 40 per cent per year and the
main buyers seem to be in the US, Japan and Western Europe.
Within India, domestic software sales were $ 800 million last year and
is growing at the rate of about 30 per cent. PC sales, booming ahead at 50 per cent
annually, will inevitably lead demand for more networking facilities. Businesses, trading
houses, distribution companies, banks and financial institutions are already planning
hundreds of intranets and these will all be part of the future market for interconnection
of intranets with the Internet. Given this demand, current facilities are miles away from
meeting customer expectations.
As for as Internet user-base is concerned, Pakistan is lot ahead of
India but both countries have slower growth rate comparing to other countries of the
region. There are 50,000 estimated Internet users in India, over 65,000 in Pakistan and
around half a million users in each of the nearby countries like Malaysia, Singapore, Hong
Kong, Thailand, Taiwan and Korea. The rapid penetration and large number of users in those
countries are mainly due to a multiplicity of ISPs - China has 30, Hong Kong 90, South
Korea 15, Singapore three, Thailand four, and Indonesia has six. Whereas Pakistan has over
40 and India has 2. In contrast, Japan has 1300 and the US has 7000 ISPs. Moreover, since
communication (leased line as well satellite bandwidth) costs are high, Pakistan and
Indian companies are establishing their Websites and homepages in the US, to enable
overseas inquirers/customers to liberally access them.
Government regulations and restrictions are prime factors for slower
Internet penetration in Pakistan and India alike. Both Pakistan and Indian governments
restricted ISPs to go through their telecom channels: through PTCL gateway in Pakistan and
through VSNL gateway in India.
After repeated demands from customers, especially businesses, the
Indian government has now taken a decision to end the monopoly for Internet service
provision and promised to give licenses to private companies without license fee for two
years. Whereas Pakistan government has already issued over a hundred ISP licenses with
Rs.500,000 license fee.
China: The World's Fastest Growing Internet Market
Internet users in China will climb from 2.1 million to more than 6.7 million in 1999
according to a recently released report called "The Internet in China" jointly
published by BDA (China) Ltd. and The Strategis Group. The report stated that by 2003,
China's Internet user base would exceed 33 million growing at an annual rate of nearly 60
percent over the next five years. It also suggested that China is already the fastest
growing Internet market in Asia and will become one of the world's leading markets in the
next five years
Millions of Internet Users in China
Source:BDA China Limited
The opportunities are growing for new players, including cable TV operators, to tap
revenues in the ISP market, which are forecast to exceed US$ 4 billion by 2003.
China also presents a burgeoning market opportunity for Internet
equipment, software and service. The "Internet in China" forecasts this sector
to exceed US$160 million in 1999. Foreign vendors currently dominate China's
Internet infrastructure market, but domestic players are expanding their efforts to serve
this growing market.